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The luxury watch market is threatened by the growing spread of counterfeit products that generate multi-billion-dollar losses for the industry and undermine consumer trust. It is estimated that around 40 million fake watches are introduced to the market every year, leading to illicit profits of roughly 1 billion dollars.

This situation has pushed companies like Hoken Tech to develop innovative solutions like TrustWatch — an AI and blockchain-based system with 96.2% accuracy in authenticating luxury watches, providing buyers with a reliable tool to distinguish genuine items from imitations.

The luxury watch sector is among the hardest hit by the phenomenon of counterfeiting worldwide. The Swiss watchmaking industry loses about 2 billion Swiss francs per year due to missed sales from counterfeit products. According to an OECD report, the watchmaking industry is the main victim of counterfeit “Swiss” goods, with a loss in sales of approximately 2 billion Swiss francs annually.

In 2018, the global trade in counterfeit and pirated goods that violated Swiss intellectual property rights amounted to 7 billion Swiss francs, equivalent to 2.3% of authentic exports. This led to a reduction in legitimate sales of 4.5 billion Swiss francs and a tax revenue loss for the Swiss government of 160 million francs, in addition to causing the loss of over 10,000 jobs — 1.7% of all Swiss manufacturing positions.

Counterfeiting has devastating consequences both for luxury brands and for consumers. Research shows that 76% of UK consumers would be less inclined to purchase products from a brand whose reputation is associated with counterfeited goods. Additionally, 66% of consumers who unintentionally bought counterfeit products lose trust in the brand, and 34% become less likely to buy from the brand’s official website if their products have been counterfeited elsewhere online.

Brand reputation damage is particularly severe because fake watches are often made with inferior materials and unethical labor practices. This erodes exclusivity and trust — essential elements for luxury brands — and fuels a shadow economy that avoids taxation, harming government revenues.

Over the years, counterfeiting methods have become increasingly sophisticated, making it difficult for consumers to distinguish between genuine and fake products. The rise of online marketplaces and advances in production techniques have fueled this growth, enabling counterfeiters to produce high-quality replicas known as “superfakes” that can deceive even experienced collectors.

The production process involves reverse-engineering authentic watches, sourcing similar materials, and using advanced machinery for assembly. The ease of use of online marketplaces has made it simpler for counterfeit organizations to exploit high-value brands, while the sophistication of illegal counterfeiting groups continues to grow. As a result, brand protection strategies must evolve alongside these rapidly changing online threats.

Counterfeit watches often have distinctive features that can help consumers identify them. These items are typically made with lower-quality materials than the originals, lack the precision and durability of authentic watches, and often display imperfections in their finishes. Details like the watch movement, case quality, dial, and logos can reveal clues about a product’s authenticity.

Luxury watch replicas can vary greatly in quality, from crudely made copies that are easy to spot to “superfakes” that require an expert eye to identify. These high-quality counterfeits have made it increasingly challenging for consumers to differentiate between genuine and fake products, raising the risk of unwittingly purchasing inauthentic items.

Identifying a fake watch often requires careful attention to visual details that can reveal the product’s lack of authenticity. Key elements to examine include:

Although visual verification techniques are useful, they may be insufficient for identifying high-quality fakes, making professional authentication services or specialized technologies necessary.

Documentation and provenance are essential to establishing the authenticity of a luxury watch. Genuine watches are generally accompanied by:

The absence of such documentation should be a red flag for potential buyers. Authorized dealers and reputable auction houses always guarantee provenance and provide full documentation for the watches they sell. The importance of provenance is so significant that brands like Rolex have introduced specific programs, such as the Certified Pre-Owned Program, to ensure the authenticity of second-hand watches by providing a certificate of authenticity and a warranty.

TrustWatch is a revolutionary application developed by Hoken Tech that uses artificial intelligence to authenticate luxury watches. The system is designed to provide a reliable and easily accessible authentication service by analyzing images of watches and determining their authenticity with a high degree of accuracy. Its main goal is to build a trusted platform for collectors and buyers of luxury watches while fostering an enthusiastic, engaged community.

TrustWatch represents significant innovation in the luxury watch market, offering cutting-edge solutions for authentication and community building. With advanced features, a clear growth strategy, and a solid business model, TrustWatch is set to become the go-to reference for luxury watch collectors and enthusiasts worldwide.

TrustWatch provides several advanced features that make it an indispensable tool for anyone wanting to verify the authenticity of a luxury watch:

TrustWatch combines machine learning techniques and artificial intelligence algorithms to verify the authenticity of luxury watches:

TrustWatch is making a significant difference in reducing the spread of fake watches on the market. With its ability to authenticate luxury watches at a 96.2% accuracy rate, the system provides a reliable tool to identify counterfeit products. This is especially crucial considering that counterfeit watches cost the luxury watch industry billions of dollars in losses every year.

The adoption of TrustWatch by collectors, retailers, and repair labs is creating a wider verification network that makes it harder for counterfeit watches to go unnoticed. Users can easily verify a watch’s authenticity before purchasing, thereby reducing the risk of unknowingly buying fake items.

TrustWatch is significantly boosting consumer confidence in the luxury watch market. Having a reliable and accessible authentication system reduces the uncertainty often associated with purchasing luxury watches, particularly in the secondary market. This is especially important given that 66% of consumers who have unintentionally purchased counterfeit goods lose trust in the brand.

The app empowers consumers to verify a watch’s authenticity themselves, giving them greater control and peace of mind in their buying decisions. This has led to increased trust not only in the products but also in the retailers who use TrustWatch to authenticate their inventories. Strengthening consumer confidence is essential for the luxury watch market, where the perception of authenticity and quality underpins the value and prestige of these products.